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STOCKHOLDERS' EQUITY
 3 Months Ended
Mar. 31, 2025
STOCKHOLDERS' EQUITY  
STOCKHOLDERS' EQUITY

6.STOCKHOLDERS’ EQUITY

The following table represents a share reconciliation of the Company’s common stock issued for the periods presented:

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Three Months Ended March 31,

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2025

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2024

Common stock:

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Balance, beginning of period

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195,028,207

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183,606,708

Shares issued for stock options exercised

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56,412

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211,158

Agent growth incentive stock-based compensation

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446,657

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353,688

Agent equity stock-based compensation

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2,004,995

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2,189,922

Balance, end of period

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197,536,271

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186,361,476

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The Company’s equity programs described below were administered under the stockholder approved 2015 Equity Incentive Plan, as amended, for issuances prior to September 1, 2024, and under the stockholder approved 2024 Equity Incentive Plan for issuances on or after September 1, 2024. The purpose of the equity plans is to retain the services of valued employees, directors, officers, agents, and consultants and to incentivize such persons to make contributions to the Company and motivate excellent performance.

Agent Equity Program (“AEP”)

The Company provides agents and brokers the opportunity to elect to receive 5% of commissions earned from each completed real estate transaction in the form of shares of common stock AEP. If agents and brokers elect to receive portions of their commissions in shares of common stock, they are entitled to receive the equivalent number of shares of common stock based on the fixed monetary value of the commission payable. The Company recognized a 10% discount on these issuances prior to February 29, 2024, and a 5% discount on these issuances beginning as of March 1, 2024, as an additional cost of sales charge during the periods presented.

During the three months ended March 31, 2025 and 2024, the Company issued 2,004,995 and 2,189,922 shares of common stock, respectively, to agents and brokers with a value of $20,756 and $25,868, respectively, inclusive of discount.

Agent Growth Incentive Program (“AGIP”)

The Company administers an equity incentive program whereby agents and brokers become eligible to receive awards of the Company’s common stock through agent attraction and performance benchmarks. The AGIP encourages greater performance and awards agents with shares of common stock based on achievement of performance milestones. Awards typically vest after performance benchmarks are reached and three years of subsequent service is provided to the Company. Share-based performance awards are granted on a fixed-dollar amount of shares based on the achievement of performance metrics. As such, the awards are classified as liabilities until the number of share awards becomes fixed once the performance metric is achieved.

For the three months ended March 31, 2025 and 2024 the Company’s stock-based compensation expense attributable to the Agent Growth Incentive Program was $8,119 and $8,827, respectively, of which the total amount of stock-based compensation attributable to liability classified awards was $622 and $650, respectively.

The following table illustrates changes in the Company’s stock-based compensation liability for the periods presented:

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Amount

Balance, December 31, 2023

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$ 5,000

Stock grant liability increase year to date

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2,251

Stock grants reclassified from liability to equity year to date

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(2,206)

Balance, December 31, 2024

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$ 5,045

Stock grant liability increase year to date

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622

Stock grants reclassified from liability to equity year to date

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-

Balance, March 31, 2025

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$ 5,667

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Stock Option Awards

Stock options are granted to directors, officers, certain employees and consultants with an exercise price equal to the fair market value of common stock on the grant date and the stock options expire 10 years from the date of grant (or 5 years from the date of grant for options granted to significant stockholders). These options typically have time-based restrictions with equal and periodically graded vesting over a three-year period.

During the three months ended March 31, 2025 and 2024, the Company granted 72,845 and 353,656 stock options, respectively, to employees with an estimated grant date fair value of $5.66 and $6.93 per share, respectively. The fair value was calculated using a Black Scholes-Merton option pricing model.

Other Awards

In addition to the core programs described above, the Company may grant other equity-based or ad hoc awards as needed to attract and retain employees, agents, or team leaders. These awards are generally granted with time-based or performance-based vesting conditions, and the terms are determined based on the specific objectives of the grant.

To date, participation and grants of this variety have been limited.

Restricted Stock Units (“RSUs”)

The Company grants RSUs to officers and certain employees and may grant them to directors and consultants in the future. Each RSU represents the right to receive one share of the Company’s common stock upon vesting, subject to time-based

and/or performance-based restrictions. RSUs typically vest over a three-year period with equal and periodically graded vesting or cliff vesting, as applicable. RSUs do not have an exercise price, and no payment is required by the grantee to receive the shares upon vesting. The fair value of the RSUs granted is determined based on the closing market price of the Company's common stock on the grant date. The total fair value of RSUs is recognized as stock-based compensation expense over the vesting period, with adjustments for estimated forfeitures. For the quarters ended March 31, 2025 and 2024, the Company granted 47,652 and 0 RSUs, respectively, with weighted average grant date fair values of $10.67 and n/a. As of March 31, 2025 and 2024, the total unrecognized stock-based compensation associated with these RSUs was $480 and n/a, which are expected to be recognized over a weighted average period of approximately 3.05 and 0 years, respectively.

Stock Repurchase Plan

In December 2018, the Company’s board of directors (the “Board”) approved a stock repurchase program (as amended, the “Stock Repurchase Program”) authorizing the Company to purchase up to $25.0 million of its common stock, which was amended in November 2019 to increase the authorized repurchase amount to $75.0 million. In December 2020, the Board approved another amendment to the Stock Repurchase Program, increasing the total amount authorized to be purchased from $75.0 million to $400.0 million. In May 2022, the Board approved an increase to the total amount of its Stock Repurchase Program from $400.0 million to $500.0 million. In June 2023, the Board approved an increase to the total amount of its Stock Repurchase Program from $500.0 million to $1.0 billion. Purchases under the Stock Repurchase Program may be made in the open market or through a 10b5-1 plan and are expected to comply with Rule 10b-18 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The timing and number of shares repurchased under the Stock Repurchase Program depends upon market conditions. The Stock Repurchase Program does not require the Company to acquire a specific number of shares. The cost of the shares that are repurchased under the Stock Repurchase Program is funded from cash and cash equivalents on hand.

10b5-1 Repurchase Plan

In connection with the Stock Repurchase Program, from time to time, the Company adopts written trading plans pursuant to Rule 10b5-1 of the Exchange Act to conduct repurchases on the open market.

On January 10, 2022, the Company and Stephens Inc. (“Stephens”), a financial services firm that acts as an agent authorized to purchase shares on behalf of the Company, entered into that certain Issuer Repurchase Plan (as amended, the “Issuer Repurchase Plan”) which authorized Stephens to repurchase shares of common stock of the Company, which is amended from time to time to adjust the monthly repurchase amount. Most recently, on March 12, 2025, the Board approved, and the Company entered into a Tenth Amendment to the Issuer Repurchase Plan which provides for the repurchase of up to (i) $2.0 million during the calendar month of March 2025, (ii) $7.5 million during each of the calendar months commencing April 1, 2025 through and including May 31, 2025, (iii) $10.0 million during the calendar month of June 2025, (iv) $15.0 million during each of the calendar months commencing July 1, 2025 through and including October 31, 2025, and (v) $10.0 million during each of the calendar months commencing November 1, 2025 through and including December 31, 2025.

For accounting purposes, shares of common stock repurchased under the Stock Repurchase Program are recorded based upon the applicable trade date. Such repurchased shares are held in treasury and are presented using the cost method. These shares are considered issued but not outstanding.

The following table shows the share changes in treasury stock for the periods presented (not in thousands):

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Three Months Ended March 31,

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2025

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2024

Treasury stock:

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Balance, beginning of period

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40,894,822

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28,937,671

Repurchases of common stock

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472,319

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2,577,242

Balance, end of period

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41,367,141

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31,514,913

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